15 April 2013 04:17 [Source: ICIS news]
SINGAPORE (ICIS)--The economies of developing East Asia and the Pacific are expected to grow by 7.8% this year before easing to 7.6% in 2014 amid improving external conditions and strong domestic demand, the World Bank said on Monday.
The region’s economy grew by 7.5% in 2012, according to the global lender in its latest East Asia and Pacific Update.
China’s economy, meanwhile, is projected to grow by 8.3% this year before moderating to 8.0% in 2014.
China on Monday reported that its GDP grew by 7.7% year on year in the first quarter of 2013, slowing down from the 7.9% growth seen in the fourth quarter of last year.
“While still fragile, there are signs of a turnaround in real activity in high income economies, thus external demand for the East Asia and Pacific region’s exports will stabilise this year,” it said.
Risks emanating from the eurozone and the US have shrunk since the middle of last year, according to the World Bank.
Its baseline projections for global growth are for a “modest expansion” of 2.4% this year and a gradual strengthening to 3.0% in 2014.
Looking ahead, the World Bank warned that there is the risk of “overheating” in some of the larger economies in the region.
“Most countries in developing East Asia are well prepared to absorb external shocks, but continued demand-boosting measures may now be counterproductive, as it could add to inflationary pressures,” said World Bank East Asia and Pacific chief economist Bert Hofman.
“A strong rebound in capital inflows to the region induced by protracted rounds of quantitative easing in the US, EU and Japan, may amplify credit and asset price risks,” Hofman added.
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